A Huffington Post Canada article dated October 23, 2013 tackles the Bank of Canada’s apprehensions about the future of the housing market. The real estate industry has lately been doing rather well, but the Bank of Canada foresees disaster up ahead. The article presents the Bank’s perception of the industry, and the actions it’s taking to avoid a potential catastrophe:
Some observers say the small mortgage rate hikes that took place this spring are behind the strong house prices, as buyers were motivated to lock in now, before rates rose any further.
This phenomenon “would provide a temporary boost to economic activity, but could exacerbate existing imbalances and therefore increase the probability of a correction later on,” the Bank of Canada said.
The bank hinted Wednesday that it may keep interest rates low longer than it had previously forecast, due to a deteriorating forecast for the economy.
That could be either good news or bad news for the housing market. Lower interest rates are supportive of house prices. But if recent strength has been due to people flooding the market ahead of expected rate hikes, then the bank’s announcement will reduce pressure on the housing market, potentially weakening it.
Knowing this, the public needs to be careful about real estate purchases, especially when conditions are currently volatile. A little expert advice from an industry authority can lend some perspective, allowing prospective homeowners to weigh their options carefully. Real estate brokers can provide buyers all the information they need on reasonably-priced houses for sale in Calgary to make more informed decisions.
Meanwhile, buyers will want to know about everything that can help them own a home for a fair price. Consumers buying a beautiful house for sale in Calgary for the first time should take advantage of things like the First-Time Home Buyers Tax Credit and other similar credit products offered on the market. Those who are moving into another home should consider other options, such as assuming the mortgage of other property owner. All these can be arranged by coordinating with a qualified real estate broker.
Real estate brokers affiliated with a trusted professional association like the Calgary Real Estate Board (CREB®) can help buyers easily navigate through the process of acquiring a home. Such brokers also offer valuable analyses of current market conditions, and whether or not buyers should hold off for now or lock in prices today. To most buyers and sellers, the help of an experienced and reliable broker can certainly make things a lot less daunting.
(From Canadian Housing Market At Increased Risk of ‘Correction’: BoC, Huffington Post Canada, October 23, 2013)